Merkel says would back cutting EU tariffs on US car imports

A USA official has reportedly offered a proposal to German auto executives to eliminate vehicle-import tariffs with the European Union.

Investors should curb their enthusiasm over hopes that the European Union can sign a quick auto deal with President Donald Trump. Various automakers have criticized the move which some speculate is simply a negotiation tactic from Trump.

Handelsblatt reports that Grenell's proposal to the CEOs of BMW, Volkswagen and Daimler was that both sides remove auto import tariffs altogether.

The U.S. Commerce Department has been collecting comments on whether imported automobiles could be considered a national security threat, and the Trump Administration had reportedly been considering as much as a 25 percent tariff on imported autos and auto parts. According to World Trade Organization rules, the European Union would also be required to make similar reductions on vehicles imported from other countries.

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"I would be ready to support negotiations on reducing tariffs, but we would not be able to do this only with the U.S.", Merkel said. The EU has a 10 per cent levy on vehicle imports from the United States.

Trump has already angered Germany and the rest of the European Union by slapping tariffs on the bloc's steel and aluminum.

The EU executive responded by imposing its own import duties of 25 per cent on a range of U.S. goods, including steel and aluminium products, bourbon, jeans, motorbikes, and farm produce such as sweetcorn and peanuts.

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